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Consolidated Industries, Inc. v. United States

November 04, 1999

CONSOLIDATED INDUSTRIES , INC., PLAINTIFF-APPELLANT,
v.
UNITED STATES, DEFENDANT-APPELLEE.



Before Rader, Circuit Judge, Friedman and Archer, Senior Circuit Judges.

The opinion of the court was delivered by: Friedman, Senior Circuit Judge.

Appealed from: United States Court of Federal Claims Judge Robert H. Hodges, Jr.

This appeal challenges a decision of the Court of Federal Claims that upheld a contracting officer's default termination of the appellant Consolidated Industries, Inc. ("Consolidated")'s government contract for failure to meet the contractual delivery schedules. We affirm.

I.

The pertinent facts, as set forth in the opinion of the Court of Federal Claims and in the record, are undisputed.

In March 1988 Consolidated entered into a contract with the Army to produce battery assemblies for an anti-tank weapons system. The contract had been set aside for a small business concern (which Consolidated was, Tr. 84-85), pursuant to Section 8(a) of the Small Business Act, 15 U.S.C. 637(a) (1988). The government issued a number of orders for delivery of specified numbers of assemblies on specified dates, and made progress payments to Consolidated during the performance of the contract.

Between 1988 and 1993 Consolidated failed to meet several delivery dates, which were extended. The government also found flaws in some of the battery assemblies that Consolidated produced.

In October 1994, the parties agreed to modify the contract, which was provided by a written modification ("the Modification") under which:

1. Consolidated agreed to ship 1800 battery assemblies "in order to liquidate progress payments" already made. Sixty were to be shipped in January 1995, 100 a month from February 1995 to June 1996, and forty in January 1996.

2. The parties agreed to a no cost termination of the balance of the contract.

The Modification included the following provisions:

The contractor unconditionally waives any charges against the government arising under this order/contract or by reason of cancellation, including, without limitation, all obligations of the government to make further payments or to carry out any further undertakings under the cancelled portion of the contract. The government acknowledges that the contractor has no obligation to perform further work or services or to make further deliveries under the cancelled portion of the contract. Nothing in this paragraph affects any other covenants, terms, or conditions of the contract.

The parties agree that this modification constitutes full, final and complete settlement, satisfaction and accord for any and all claims arising out of this order/contract, whether past or present.

Consolidated failed to make the January and February deliveries the Modification required, and the contracting officer terminated the contract for default. The contracting officer made detailed findings about the performance of the contract and her reasons for termination. The contracting officer described her consideration of seven specific factors the Federal Acquisition Regulations ("FAR") require a contracting officer to consider in determining whether to terminate for default. As those ...


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